Fed up with the Big Six energy firms? Meet Dale Vince, the eccentric entrepreneur shaking up the industry

We chatted to the green energy boss

Ecotricity achieved something medium-sized businesses rarely do – it doubled its customer numbers in just one year. Robyn Vinter spoke to the green energy provider’s founder and CEO Dale Vince OBE to find out what’s behind its crazy growth… and what it’s like being an oddball in your industry.

Q. How is Ecotricity different to the other big energy suppliers?

Our big difference is one of purpose. We exist to try and change the way energy is made in Britain. We have a not-for-profit approach, or we call it not-for-dividend actually. We don’t serve shareholders and all of the money we make goes back into building new forms of green energy.

The other differentiator that’s probably worth mentioning though is one of customer service. We dedicate ourselves to the notion that we want to treat our customers the way we ourselves like to be treated, and we spare no effort or expense to make that happen.

It starts by answering the phones ourselves. We have no telephone tree - when you ring you get a person. Our people are trained to be able to do just about anything, so nine out of 10 enquiries are dealt with by the first person you speak to.

The complaints data that Ofgem produces each year shows that on a per 1,000-customer basis, our complaints are the lowest in the industry by an order of magnitude: we’re 20 to 40 times better than the Big Six in complaint data - which is the kind of acid test of good customer service I think.

 

Q. What do you base the prices on that customers pay?

Last summer we went 100% green and changed our prices a little bit. I think it was last summer we broke away from the pricing of the Big Six as, up until then, we matched them. Offering green for the price of brown, as we liked to call it, was a simple marketing message and a fair place to be in the market.

We broke away from that last year because we’d got to about 30% of our electricity made by our own windmills. That was insulating us from the movement of the main energy prices driven by fossil fuels, and we wanted to begin to reflect that in the prices to our own customers. So we had a couple of subsequent price freezes while the rest of the industry went up and it created a gap between us and the standard Big Six tariffs.

The answer to stable energy bills is to make it here in Britain from renewable sources. So our current strategy is to be cheaper than the Big Six and to continue to get more cheaper - if that’s the correct term…

 

Q. Where do you stand on fracking?

Dead against! (He laughs.) Our gas tariff is frack-free, and although there is no fracked gas in the grid at the moment, our pledge is nonetheless important. Because what we’ve done is create an audit process so that as fracked gas enters the National Grid, we can ensure that it doesn’t enter our supply.

We’ve also pledged not to invest in fracking either, whereas unbeknownst to most people who are with British gas, I think 70% of the country takes its gas from British Gas, they’re the biggest investor in fracking of all the energy companies.

The ultimate power lies in the hands of the consumer. If people refuse to buy fracked gas, if other energy companies copy us and create frack-free promises, we can use consumer power – people power – to make fracking all the more difficult.

 

Q. During the last election David Cameron promised to be the greenest government ever. Has he kept his promise? And is the political climate for renewables more challenging than it was before the coalition?

There’s no doubt David Cameron promised to run the greenest government ever. He talked the talk, and equally there’s no doubt what his government did was the exact opposite.

There have been successive cuts in support for all forms of renewables. The planning regime for onshore wind changed three times in the duration of that parliament, to make it harder. The success rate for planning applications for onshore wind halved in this time, and the government boasted of that. The Tories also said that they would end onshore wind and solar if they got back into power. So there’s no guessing required. This government is anti-renewable energy and the complete opposite of what it promised to set out to be, which is madness. It really is madness.

David Cameron has gone from promising to run the greenest government ever, to denouncing as “green crap” the support for renewable energy on energy bills. And you don’t get a more stark contrast than that.

 

Q. But have you actually physically seen the impact of cuts to renewables incentives?

We’ve felt and seen the impact of that. There are loads of jobs been lost in the solar sector, small wind companies have gone bankrupt as well. Our own bigger projects have been troubled. I mean, we built Britain’s first solar park in 2010 and we had a pipeline of other projects that we just had to stop because no sooner had we built the first one than this government slashed the support for big solar. They said at the time they were doing it in order to save money to support small solar. We didn’t believe it, and then within a month or two they also slashed support for small solar. So yes, we’ve seen and felt it.

 

Q. Before setting up Ecotricity in 1996, you lived self-sufficiently on the road for 10 years, as a New Age traveller. Are there any other people like you in the energy industry? Or a you basically an oddball?

I don’t find people like me in many places, but especially in the energy industry I would say. It’s a kind of suited and booted environment and I’m still a jeans and t-shirt kind of guy but that doesn’t trouble me at all. Perhaps it’s advantageous. For me the world is too conservative (with a small c), in terms of how it dresses and dress codes and stuff like that.

 

Q. What kind of growth are you anticipating over say the next five to 10 years?

That’s a difficult period to look at, being so far ahead. In the last 12 months our customer numbers doubled, which is quite incredible. Before that 20-30% a year was quite normal, and that took some keeping up with, but the doubling has been an incredible challenge and quite exciting.

Five years from now I think I’d be disappointed if we weren’t at half a million customers.

That’s one side of what we do of course. The other side is building green energy projects. We’ve got about 60 megawatts operating and we’re commissioning a new wind park in a couple of weeks that will add 10 more. We’ve got 80 megawatts consented and about 200 megawatts in the pipe, so we foresee a major growth in green energy generation as well, because that’s part of our model. We need to make the energy as well as sell it, so I would think in the same timeframe getting to 500 megawatts of energy would be quite sensible. And we should by then have a number of our green gas projects on the go as well, whereby we’re going to be making gas and putting that into the gas grid.

 

Q. What’s responsible for your extremely rapid growth? Is it that people are just starting to hear about you or that people are getting more disillusioned with who supplies their energy at the moment?

I think it’s a bit of both of those things. Last year in October there was a bit of a perfect storm for us, where the media began to circulate rumours the Big Six were about to put prices up, which happens at the start of winter - it’s a cynical move. And at the same time Ed Miliband made his conference pledge to freeze prices if he got elected for 20 months and then just at the same time we’ve gone 100% green, we’ve broken our Big Six price match, and we actually announced a winter long price freeze, so that put us in the eye of the perfect storm. People are just so fed up of the Big Six, it was like a last straw moment.

 

Q. Businesses are waking up to being more sustainable and environmentally-friendly. As possibly the king of sustainability, what do you see as the main benefit of putting more sustainable measures into your business?

Why it’s important – for me it’s absolutely fundamental. I don’t see how life can be lived without a view to being sustainable. I abhor waste of energy, of resources, of time, of anything. It just seems wrong to me. From a conventional business perspective there needs to be an economic rationale. Being green will save you money. There’s no doubt about that.

But also the general population is increasingly expecting to see businesses take the environment seriously. It’s not just about saving money, it’s about winning customers over, because your customers expect you to take more responsibility for the impact you have. It’s becoming just necessary. It’s already happened to the really big companies, like M&S and Sainsbury’s, and it’s coming down the chain to SMEs. It’s got to be done - a bit like being suited and booted, I’m afraid!

Thanks for your time Dale.

Thanks Robyn!

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Readers' comments (2)

  • Anonymous

    Sounds wonderful - but how much subsidy does he get in comparison with traditional power producers?

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  • Anonymous

    I found out about Ecotricity 4 months ago after reading about Mr Vince's (long) ex-Wife trying to take him to the cleaners (which just goes to show there is no such thing as bad publicity). I then signed up with Ecotricity which was a refreshing experience after the "Big 6" and I am saving 10% on my domestic bills. Dale Vince is a breath of fresh air, hopefully through his turbines; another Branson. Good luck, sir.
    Old Possum

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